Raja MUHAMMAD KHUBAIB vs ADDITIONAL DISTRICT JUDGE, LAHORE Ss — 2024 CLC 1888 LAHORE-HIGH-COURT-LAHORE

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Raja MUHAMMAD KHUBAIB VS ADDITIONAL DISTRICT JUDGE, LAHORE Ss. 18 & 12---Suit for specific performance of agreement to sell---Additional payment as compensation imposed on the plaintiff (buyer)---Legality---Trial Court decreed the suit filed by the vendee /buyer but directed him to pay additional amount as compensation, over and above the consideration amount under the agreement to sell---Trial Court granted compensation on the basis that the plaintiff and defendant (vendor) were equally responsible for non-performance of the agreement to sell on agreed /stipulated date---Plaintiff filed revision before the High Court as the said grant of compensation was maintained by the Appellate / District Court---Whether imposition of compensation through additional payment was justified or not---Held, that concept of compensating, in monetary terms, is essentially a tool to recompense the party that suffers loss, injury or disadvantage---Loss caused; injury occasioned; disadvantage suffered, in contractual arrangements, would, correspondingly, be the cause and effect of default committed or failure attributable to one of the parties to the contract---Hence, before subjecting defaulting party to the obligation of compensating then on-defaulting party, it is imperative to substantiate "factum of default"---It is axiomatic that, in the present case, Trial Court reached the conclusion observing that "now the plaintiff and defendant are equally responsible for non-performance of the agreement to sell on agreed/stipulated date"---If that was the position how could the petitioner/plaintiff be penalized by subjecting it to payment of additional payment when failure was attributed to both the parties---High Court failed to identify and reject blatant discrepancy in the judgment and instead endorsed the illegality---This peculiar mistake is fatal to the sustainability of the judgments it appears that Courts misread the evidence and overlooked effect thereof---High Court set-aside judgments and decrees of the Courts below, to the extent of allowing/decreeing additional amount (Rs.6,769,350/-) as compensation against the petitioner---Revision was allowed, in circumstances. Citation Name: 2024 CLC 1888 LAHORE-HIGH-COURT-LAHORE Raja MUHAMMAD KHUBAIB VS ADDITIONAL DISTRICT JUDGE, LAHORE S. 12---Suit for specific performance of agreement to sell---Condition(s), observance of---Scope---Earnest money---Return or forfeiture---Scope---Trial Court decreed the suit filed by the vendee / buyer but directed that in case the plaintiff /buyer failed to pay balance consideration within 30 days, the seller would be bound to return earnest money---Plaintiff/buyer filed revision as said findings / observation was affirmed by the Appellate Court---Held, that such observation / findings was contrary to the terms of the agreement, which (agreement) provided that in case the buyer (petitioner) failed to pay the remaining amount, earnest money would be treated forfeited---Said agreement provided that in case the seller failed or refused to arrange for the transfer, he would be bound to return double amount of earnest money---Said (latter) condition was not applicable since the buyer had opted for enforcement of the agreement by resorting to remedy for enforcement of agreement---If the petitioner failed to pay the balance consideration within 30 days, without further ado, the earnest money had to be forfeited---High Court set-aside judgments and decrees of both the Courts below to the extent of direction that in case the plaintiff /buyer failed to pay balance consideration within 30 days, the seller would be bound to return earnest money; modifying the decree that in case of said failure petitioner's suit shall stand dismissed and consequently the paid earnest money shall stand forfeited---Suit was decreed in the above terms. Citation Name: 2024 CLC 1888 LAHORE-HIGH-COURT-LAHORE Raja MUHAMMAD KHUBAIB VS ADDITIONAL DISTRICT JUDGE, LAHORE Ss. 12 & 18---Suit for specific performance of agreement to sell---Time as essence of the agreement---Performance within stipulated time, significance of---Additional payment as compensation, imposed on buyer---Legality---Trial Court decreed the suit filed by the vendee / buyer but directed him to pay additional amount as compensation, over and above the consideration amount under the agreement to sell---Trial Court granted compensation on the basis that the plaintiff and defendant (vendor) were equally responsible for non-performance of the agreement to sell on agreed /stipulated date which was maintained by the Appellate Court---Timelines for performance were provided in the agreement and the same were extended on two occasions---Question was whether petitioner (plaintiff / buyer) had defaulted after second extended agreed date and whether any intent of timely performance of agreement was demonstrated on the part of the respondent (defendant / seller)---Held, that there is no hard and fast rule to determine whether time is the essence of the agreement---No doubt performance timelines in the agreement had significant bearing on the question of timely performance and effect of failure, but mere lapse of cut off date, propriovigore would not non-suit the buyer---Such determination is dependent upon facts and circumstances encountered in each case---Respondent (defendant / seller) admitted absence from Pakistan during material times---Written statement was silent regarding issuing any notice of default on the part of the petitioner---No notice of cancellation was issued, let alone alleged---Respondent was the only witness who appeared---No document was brought on record to show that any authority was extended to any person to undertake process of transfer of suit-plot, in the absence of respondent---Respondent (defendant / seller) failed to prove factum of default on the part of the petitioner (plaintiff/buyer) and also failed to make out a case for cancellation of the agreement in the context of relevant condition of the agreement---Pertinently, balance consideration amount was deposited by the petitioner / plaintiff under the direction of the Court---High Court set-aside judgments and decrees of both the Courts to the extent of allowing/decreeing additional amount (Rs.6,769,350/-) as compensation against the petitioner---Civil Revision was allowed, in circumstances. Citation Name: 2024 CLC 1888 LAHORE-HIGH-COURT-LAHORE Raja MUHAMMAD KHUBAIB VS ADDITIONAL DISTRICT JUDGE, LAHORE Ss. 18 & 12---Suit for specific performance of agreement to sell---Additional payment as compensation imposed on plaintiff (buyer)---Legality---Default ascertaining of---Trial Court decreed the suit filed by the vendee/buyer but directed him to pay additional amount as compensation, over and above the consideration amount under the agreement to sell---Trial Court granted compensation on the basis that the plaintiff and defendant (vendor) were equally responsible for non-performance of the agreement to sell which was maintained by the Appellate Court---Validity---Record revealed that the respondent (defendant / vendor) himself appeared as witness, admitting that he, after the agreement, remained abroad for about seven months at relevant days of the extension of time period for performance---One of the conditions of the agreement was physical presence of the respondent before Registering Agency (DHA) at the time of transfer of the suit-plot---Thus, the direction of payment of additional amount (of Rs. 6,769,350/-) was unjustified, unlawful and devoid of reasoning---High Court set-aside judgments and decrees of both the Courts to the extent of allowing/decreeing additional amount Rs.6,769,350/-as compensation against the petitioner---Revision was allowed , under circumstances.

Raja MUHAMMAD KHUBAIB vs ADDITIONAL DISTRICT JUDGE, LAHORE Ss — 2024 CLC 1888 LAHORE-HIGH-COURT-LAHORE

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